We are in a raging bull market. Trust me.
In a bear market, there is only one mistake, not selling early. In a bull market, all my mistakes have been from selling early #lindzanity
— howardlindzon (@howardlindzon) October 24, 2013
The people that are underinvested (all of us) love to think we are missing out because we are so smart and it is a bubble. I love this quote from Eddy:
A bubble is a bull market in which you don't have a position.
— Eddy Elfenbein (@EddyElfenbein) November 2, 2013
Instead of finding new ideas, we are stuck on the winners of the last bull market…in this case it is all Apple all the time. This one on Apple’s cash hoard is great from Eddy:
Funny how $AAPL earned their $147 billion in cash by themselves yet everyone else is convinced they know best how it should be spent.
— Eddy Elfenbein (@EddyElfenbein) November 3, 2013
All the publications and people that called for the crash and bubble back in August are back at it again in November.
Here is Alley Insider’s traffic piece – This time WITH EVIDENCE.
In August, I wrote a piece entitled ‘Am I Paid to Worry or Make Money‘.
In that blog post, some ‘smart’ people were calling for a ‘Perfect Storm’ in Europe (since that warning, the average European stock market is up 20 percent) and a ‘historic crash’ (do not click on that link as it is drivel).
Eventually they will be correct and will be on record with their calls. The media will seek them out because of the power of Google Search (up twenty percent since the crash blog posts).
I would not know about these posts if it was not for friends and clients emailing them to me as if I need to be saved/warned.
I wrote a blog post in 2012 for all the emails I get on the ‘Crash’ and Bubble’ warnings. There is never a bubble in Schlepping!
I have built a pretty strong list of people I trust that read the ‘tea leaves’ of the markets to help me ride trends and sidestep disasters. You can follow them with me on Stocktwits. No matter, the markets are difficult and I will still make mistakes. All investments carry risk.
Here are a few data points that stand out to me in this market:
1. IPO’s are on pace for records in 2013. Great for the companies that are raising cash and maybe a sign of excess supply and froth.
2. The Starbucks GLOBAL Takeover. This may be a bubble for Starbucks and coffee, but it is the BEGINNING of an awesome roadmap for every company and consumer brand that wants to go global.
3. Charts like Netflix. Is $NFLX the poster child for this ‘bubble’ or the poster child for global ‘social leverage’ and the impossibility of measuring viral brands and growth.
4. There is some silly investment behavior at play. To me it feels at the fringe and a lot of it is about entrepreneurs pushing technology and loose money at the early stage level.
5. Money Flows into Equities. This one has me most concerned as it feels like people are chasing. Timing this of course is almost impossible.
I remain 30-50 percent invested in stocks for my fund and model portfolio. That has proven to be too conservative to keep up with the averages. It does reflect my real concerns about the tea leaves I have laid out. As always, I am flexible.
If the markets crash, a few hedge funds and their investors will make billions. The rest of us are too diversified in our lives and portfolio to side step it. As always, investing is a marathon and you should be honest about your risk appetite and find people and investments that are true to your risk profile.
Finally – In this weeks ‘Stocks and Scotch‘ Sverre and I have on IMF and Macro Whiz Mark Dow and we both riff on Google, Macro Conditions and Global versus neighborhood investment tactics and strategies. Head to MINUTE 37 for our start: